Children’s Advertising – AdLaw By Request® https://www.adlawbyrequest.com
Information, news and updates on legal and regulatory activities pertaining to advertising and marketing around the globeThu, 17 Jan 2019 17:30:52 +0000en-UShourly1https://wordpress.org/?v=4.9.9https://adlawbyrequest.reedsmithblogs.com/wp-content/uploads/sites/5/2016/05/cropped-RSTwitterAvatar_512x512-32x32.jpgChildren’s Advertising – AdLaw By Request® https://www.adlawbyrequest.com
3232Is that a selfie or an ad? UK watchdog launches investigation into influencer marketing.https://www.adlawbyrequest.com/2018/09/articles/regulatory-uk/is-that-a-selfie-or-an-ad-uk-watchdog-launches-investigation-into-influencer-marketing
https://www.adlawbyrequest.com/2018/09/articles/regulatory-uk/is-that-a-selfie-or-an-ad-uk-watchdog-launches-investigation-into-influencer-marketing#respondMon, 10 Sep 2018 21:20:41 +0000https://www.adlawbyrequest.com/?p=6218Continue Reading]]>We are all familiar with celebrities and social media stars using their social media accounts to promote brands and products. For some, it is their main source of income and they can make millions in endorsement and sponsorship deals. Major TV and sports icons can command hundreds of thousands of pounds per post, which may sound extraordinary but the reality is that this is fast becoming one of the primary means for marketing to young people.

The problem with influencer marketing is that the commercial relationship is not always appropriately disclosed, making it difficult for consumers to distinguish between editorial content and advertising.

In response to this, the Competition and Markets Authority (CMA) has now launched an investigation into the failure of influencers to properly declare the promotional or paid-for nature of some of their social media posts.

Regulatory scrutiny on these issues is nothing new; the CMA conducted similar work in 2016 in relation to online review and endorsements. Similarly, the Advertising Standards Authority (ASA) announced earlier this year that it had launched a project exploring consumers’ ability to recognise ads online and the adequacy of labelling.

What does the law require?

Currently, the most relevant laws which seek to prevent this behaviour are contained in the Consumer Protection from Unfair Trading Regulations 2008 (CPRs), as well as in the CAP code.

The law requires, among other things, that: (a) all marketing communications are clearly identifiable as marketing; (b) marketers must not falsely claim or imply that the marketer is acting as a consumer; and (c) marketers must make clear that advertorials are marketing communications.

The key is transparency; Consumers must understand when they’re viewing advertising rather than genuine editorial content. This is particularly important when applied to the social media accounts of individuals who may use their account for a mixture of personal posts (at the gym, eating out, or humble-bragging) and paid-for posts.

To help consumers understand when they are seeing top-quality editorial selfies and when they are seeing promotional posts, back in 2012, the industry came up with simple identifiers: #Ad – to be used where the influencer receives money or other benefit for the post and the marketer has some degree of control over the content; and #Spon – to be used where the influencer receives money or other benefit for the post, but where the marketer has no control over the content. The ASA has warned about using ambiguous labels such as “brought to you by” and “thanks to our friends at”.

Both advertisers and influencers have historically been unenthusiastic about using the identifiers, on the basis they consider that it dilutes the message and because influencers are sensitive not to appear insincere in their posts. That said, we have found that with the proliferation in influencer advertising, consumers are becoming more familiar and comfortable with seeing the #Ad / #Spon identifiers.

Practical considerations

Influencers and advertisers have been critical of the increased scrutiny on influencer marketing on the basis that they consider that the requirements are not sufficiently clear. The CAP code rules and the ASA’s guidance are purposefully broad and non-specific in nature, recognising that there is no one-size-fits-all approach. This can make it difficult applying the rules to the various social media platforms, the functionality of which can vary significantly.

For instance, it is generally accepted practice to include the marketing label/identifier for influencer marketing in the following manner:

Twitter: anywhere in the tweet

Pinterest: at the beginning of the text

Facebook: at the beginning of the post (unless the post is very short)

Instagram: on the image itself and in the accompanying post

Additionally, the platforms themselves have started to take their own steps to tackle this problem. In response to being singled out by the ASA in 2017, Instagram has now developed a ‘paid partnership’ tagging tool to enable influencers to communicate that they are working in collaboration with a brand.

These platform-specific nuances can make it difficult for influencers to understand their disclosure duties and there have been a number of celebrities who have been caught out by the rules and received adverse adjudications from the ASA.

As the primary party responsible for ensuring compliance with the disclosure requirements, there is increased pressure on advertisers to educate the influencers they work with of their disclosure responsibilities and it is recommended that the specific disclosure requirements are expressly set out in the advertiser’s contract with the influencer.

The investigation

The CMA has reportedly contacted numerous social media influencers (including influencers based outside the UK, but targeting followers in the UK) to elicit information about the deals they have in place with brands. The CMA has also asked members of the public to provide details of their experiences interacting with this type of content, with particular interest in people who have purchased products as a result of such practices.

The CMA investigation is considering the extent to which influencers are clearly and accurately identifying any commercial relationships, and whether people are being misled. “It is really important they are clearly told whether a celebrity is promoting a product because they have bought it themselves, or because they have been paid or thanked in some way by the brand,” said George Lusty, senior director at the CMA.

Although there has been no time-frame set by the CMA for the investigation, they expect to provide an update at the end of 2018. In any case, it is clear that they intend to take appropriate action where they find that there has been a breach of the law. The CMA has the power to seek enforcement orders from the courts, as well as being able to name and shame influencers and advertisers not playing by the rules.

With both the CMA and the ASA paying particular attention to this topic this year, the message to advertisers and influencers is quite clear and it will become incumbent on them to ensure their influencer marketing practices are compliant.

]]>https://www.adlawbyrequest.com/2018/09/articles/regulatory-uk/is-that-a-selfie-or-an-ad-uk-watchdog-launches-investigation-into-influencer-marketing/feed/0gpryor@reedsmith.com, nbreen@reedsmith.comSafety Tips for Parents Buying Smart and Connected Toys This Holiday Season – From CARUhttps://www.adlawbyrequest.com/2017/12/articles/childrens-advertising/safety-tips-for-parents-buying-smart-and-connected-toys-this-holiday-season-from-caru
https://www.adlawbyrequest.com/2017/12/articles/childrens-advertising/safety-tips-for-parents-buying-smart-and-connected-toys-this-holiday-season-from-caru#respondFri, 15 Dec 2017 19:33:33 +0000https://www.adlawbyrequest.com/?p=5951Continue Reading]]>Happy Holidays Readers! We wanted to share this very interesting post from the Children’s Advertising Review Unit (CARU) that discusses important issues to consider when buying that new high-tech toy.
]]>https://www.adlawbyrequest.com/2017/12/articles/childrens-advertising/safety-tips-for-parents-buying-smart-and-connected-toys-this-holiday-season-from-caru/feed/0jfeldman@reedsmith.comCARU Refers Dave & Busters Inquiry to FTChttps://www.adlawbyrequest.com/2017/11/articles/childrens-advertising/caru-refers-dave-busters-inquiry-to-ftc
https://www.adlawbyrequest.com/2017/11/articles/childrens-advertising/caru-refers-dave-busters-inquiry-to-ftc#respondMon, 27 Nov 2017 16:53:38 +0000https://www.adlawbyrequest.com/?p=5919Continue Reading]]>Last month, the Children’s Advertising Review Unit (“CARU”) referred claims by Dave & Busters Entertainment, Inc. to the Federal Trade Commission (FTC). CARU’s initial inquiry involved Dave & Busters advertising that aired during children’s programming. The ad started with large text that stated “Free Video Game Play”, and a voiceover said “Dave & Busters has free video game play weekdays this summer. You can buy a power card for $50 and play video games for free all summer.” A superscript appeared at the bottom of the screen informing viewers, in part, that the offer required purchase of a $50 power card and excluded certain games.

Despite the “free games” advertised, CARU took issue with the $50 power card purchase requirement and the exclusion of certain games from the otherwise unqualified offer. According to CARU, these conditions were not adequately disclosed to the child audience.

CARU subsequently referred the inquiry to the FTC after Dave & Busters declined to participate in the self-regulatory process.

Takeaway: When it comes to advertisements targeting children, advertisers should avoid relying on “fine print” to disclose material terms of an offer.

]]>https://www.adlawbyrequest.com/2017/11/articles/childrens-advertising/caru-refers-dave-busters-inquiry-to-ftc/feed/0jgordon@reedsmith.com, misselin@reedsmith.comCOPPA: A game developer’s primerhttps://www.adlawbyrequest.com/2017/10/articles/ad-guides-and-alerts/coppa-a-game-developers-primer
https://www.adlawbyrequest.com/2017/10/articles/ad-guides-and-alerts/coppa-a-game-developers-primer#respondMon, 16 Oct 2017 20:44:10 +0000https://www.adlawbyrequest.com/?p=5750Continue Reading]]>Please take a look at an article I recently co-wrote with my colleague Wendell J. Bartnick published on gamesindustry.biz here.
]]>https://www.adlawbyrequest.com/2017/10/articles/ad-guides-and-alerts/coppa-a-game-developers-primer/feed/0jfeldman@reedsmith.com, wbartnick@reedsmith.comThe FTC Won’t Let Them Be: Enforcement Action Brought Against App Developers for Violation of Children’s Privacy Law Presents New Challenges for Advertisershttps://www.adlawbyrequest.com/2015/12/articles/childrens-advertising/the-ftc-wont-let-them-be-enforcement-action-brought-against-app-developers-for-violation-of-childrens-privacy-law-presents-new-challenges-for-advertisers
https://www.adlawbyrequest.com/2015/12/articles/childrens-advertising/the-ftc-wont-let-them-be-enforcement-action-brought-against-app-developers-for-violation-of-childrens-privacy-law-presents-new-challenges-for-advertisers#respondThu, 24 Dec 2015 10:43:13 +0000http://www.adlawbyrequest.com/?p=4877Continue Reading]]>In a recent show of force—which some believe is the tip of the iceberg—the Federal Trade Commission (FTC) brought an enforcement action against two mobile application (app) developers for violating the Children’s Online Privacy Protection Act (COPPA) and, by extension, the Federal Trade Commission Act (FTCA). Seeking to avoid a drawn out dispute with the FTC, both app developers settled their respective charges, reportedly for a combined $360,000. What makes these cases particularly relevant for our readers are the FTC’s allegations about the relationship of the app developers to the advertising networks and its implications for advertisers and the advertising industry. For an analysis of these allegations, and how the FTC may focus its efforts in this space going forward, read below.

COPPA prohibits online services, including smart phone apps, from collecting personal information from and of children (under the age of 13) without parental consent, among other things. Federal rules developed by the FTC pursuant to COPPA’s mandate recently incorporated the term ‘persistent identifiers’ to the categories of data it considers personal information. As the FTC explains, these are “pieces of data that are tied to a particular user or device”.

The defendants, LAI Systems, LLC and Retro Dreamer, each app developers turning a profit from in-app advertising revenue, fall squarely within COPPA’s purview. As the FTC stated in its complaints against them, because of the nature and content of each of these apps, they target children. Consequently, minor-users’ personal information in the form of persistent identifiers was unlawfully collected by third party advertising networks.

The ad networks that collected these persistent identifiers from app users under the age of 13 used this information to “serve” targeted advertising based on user activity. According to the FTC’s complaint, there was neither notice to these underage users, nor consent from children’s parents about the data collected. The FTC therefore charged both app developers with violating COPPA. The app developers chose to settle their respective charges quickly, as noted above.

The FTC’s focus on protecting children’s online privacy presents increasing challenges for the advertising industry. Although in this case, the FTC’s ire was directed at the app developers for allowing ad networks to collect children’s personal information, it is certainly within the realm of possibility that such enforcement actions could be brought against ad networks for actually collecting the data, especially if the nature and content of the app would make it reasonable to know such data derived from children under the age of 13 or the FTC could prove actual knowledge. With programmatic commanding how digital advertising is purchased and sold, it is often difficult for advertisers to fully vet publishers’ and ad networks’ compliance with applicable law. Although no substitute for proper and rigorous compliance, it is important that advertisers, advertising agencies, media buying companies, app developers advertising networks and publishers carefully turn their attention to the contractual obligations, representations, warranties and indemnification provisions that define the relationships and respective liabilities between and amongst them.

]]>https://www.adlawbyrequest.com/2015/12/articles/childrens-advertising/the-ftc-wont-let-them-be-enforcement-action-brought-against-app-developers-for-violation-of-childrens-privacy-law-presents-new-challenges-for-advertisers/feed/0mstrauss@reedsmith.comLandmark Children’s Advertising Court Decision Released in Germanyhttps://www.adlawbyrequest.com/2014/01/articles/childrens-advertising/landmark-childrens-advertising-court-decision-released-in-germany
https://www.adlawbyrequest.com/2014/01/articles/childrens-advertising/landmark-childrens-advertising-court-decision-released-in-germany#respondWed, 08 Jan 2014 19:17:40 +0000http://adlawbyrequest.wp.lexblogs.com/2014/01/landmark-childrens-advertising-court-decision-released-in-germany/Continue Reading]]>The German Federal Supreme Court (FSC) released its full decision in the Gameforge “Runes of Magic” case, holding that the language Gameforge used in its advertising was in violation of the German Act Against Unfair Competition. As a result of the FSC’s decision, video games companies and other companies in Germany that create ads directed to children should become more vigilant of the language being used in advertising, or may be subject to a violation.

The ASA has banned the broadcasting of a Beats Pill speakers ad prior to 19:30. Starring Robin Thicke, the overall tone of the ad was deemed to be "sexual." Commissioned by Beats Electronics, the ad seemed to mirror the music video for the number one hit "Blurred Lines". Wearing only hot pants and crop tops, three models danced with Robin Thicke. With scenes including see-through nurses’ uniforms and a woman kneeling on her hands and knees, the ASA considered complaints as to whether the ad was sexist, inappropriate for children and whether the models were irresponsibly thin.

The ASA held the models were not underweight and dismissed claims the ad was sexist. Although certain scenes were "sexually suggestive", it did not show "sustained, overtly sexual or provocative behaviour". It recognised that the majority of viewers would associate the ad with the characteristics of a mainstream music video, combatting suggestions it would cause widespread offence. When viewed as a whole, Beats had not breached BCAP Code rules 1.2 (Responsible Advertising) or 4.1 (Harm and Offence). Nevertheless, the ASA did acknowledge the overall "tone of the ad was sexual" and would not be suitable for children. Breaching BCAP Code rule 32.3 (Under-16s), the ad may not be broadcast before 19:30.

The ASA has once again demonstrated its strong desire to promote the protection of children with this recent adjudication. It follows a spate of adjudications this year regarding the scheduling of ads in and around certain programmes targeted at or appealing to children, including ads for alcohol and ads which were deemed to potentially cause fear or distress.

]]>https://www.adlawbyrequest.com/2013/10/articles/childrens-advertising/asa-unblurs-the-lines-to-protect-children/feed/0dcue@reedmsith.comASA stumbles upon age-old problemhttps://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/asa-stumbles-upon-age-old-problem
https://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/asa-stumbles-upon-age-old-problem#respondMon, 29 Jul 2013 16:27:01 +0000http://adlawbyrequest.wp.lexblogs.com/2013/07/asa-stumbles-upon-age-old-problem/Continue Reading]]>The ASA has released a survey which was commissioned to establish what advertisements were being accessed and seen by young people online. The 27-page survey focuses much of its attention on the engagement by young people of social media platforms and, perhaps unsurprisingly, establishes that a significant proportion of young people register with social media platforms using false ages. The survey goes on to demonstrate that as a result of registration using false ages, young people were exposed to advertisements targeted at adults, including those for age-restricted products for gambling, alcohol, slimming aids and overtly sexual dating services.

As a result of the survey, the ASA has indicated that it intends to raise the age-verification issues with the various social media companies.

]]>https://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/asa-stumbles-upon-age-old-problem/feed/0nbreen@reedsmith.comFTC Issues New COPPA Guidance Focusing on Ad Networkshttps://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/ftc-issues-new-coppa-guidance-focusing-on-ad-networks
https://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/ftc-issues-new-coppa-guidance-focusing-on-ad-networks#respondFri, 26 Jul 2013 17:01:26 +0000http://adlawbyrequest.wp.lexblogs.com/2013/07/ftc-issues-new-coppa-guidance-focusing-on-ad-networks/Continue Reading]]>It’s now been almost a month since the revised COPPA Rule went into effect July 1, 2013. Earlier this year, the FTC issued new guidance on how to comply with the revised Rule. As part of its new guidance, the FTC provided a detailed set of FAQs. To see our previous blog post on the FAQs, please click here.

The FTC is planning to make additional revisions to their FAQs, with these revisions focusing on the obligations of ad networks. Specifically, the FTC explains in what circumstances an ad network is deemed to have “actual knowledge” that it has collected personal information from users of a child-directed site (see D.10, D.11, D.12), and the obligations of ad networks after they discover that they have been collecting personal information via a child-directed website (see K.2). The revised FAQs also relates traditional enforcement policy to the context of a button within an app that automatically opens an email program or social network. Providing the facility for a child to share personal information is just as problematic as if the operator was collecting that information itself. Thus, verifiable parental consent is required when permitting children to share content that may contain personal information – such as a painting combined with a field that allows for free expression.

As of the date of this writing, the FAQs have not been updated to reflect these revisions, but we anticipate they will surely be updated soon.

In the meantime, the FAQs can be seen in their entirety below.

D.5. [Now at FAQ D.10]

D.9. I operate a child-directed app that allows kids to make paintings. I don’t collect the paintings — they rest on the device — but the app includes buttons for popular email and social media providers that kids can click on within the app. The buttons open the email program or social network, populate it with the painting, and allow the child to share it along with a message. I don’t collect or share any other personal information through the app. Do I have to seek verifiable parental consent?

Yes. The COPPA rule defines “collection” to include requesting, prompting, or encouraging a child to submit personal information online, and enabling a child to make personal information publicly available in identifiable form. In addition, under the COPPA Rule, “disclosure” includes making a child’s personal information publicly available in identifiable form through an email service or other means, such as a social network. You must get verifiable parental consent before enabling children to share personal information in this manner, even through third parties on your app. This is true unless an exception applies. (See Section I, Exceptions to Prior Parental Consent). However, in the situation you describe — where a child can email a painting and a message or post content on his or her social networking page through your app — no exception applies.

D.10. I operate an advertising network service. Under what circumstances will I be held to have “actual knowledge” that I have collected personal information directly from users of another Web site or online service directed to children?

The circumstances under which you will be deemed to have acquired “actual knowledge” that you have collected personal information directly from users of a child-directed site or service will depend a lot on the particular facts of your situation. In the 2012 Statement of Basis and Purpose, the Commission set forth two cases where it believes that the actual knowledge standard will likely be met:

where a child-directed content provider (which is strictly liable for any collection) directly communicates the child-directed nature of its content to you, the ad network; or

where a representative of your ad network recognizes the child-directed nature of the content.

Under the first scenario, any direct communications that the child-directed provider has with you that indicate the child-directed nature of its content would give rise to actual knowledge. In addition, if a formal industry standard or convention is developed through which a site or service could signal its child-directed status to you, that would give rise to actual knowledge. Under the second scenario, whether a particular individual can obtain actual knowledge on behalf of your business depends on the facts. Prominently disclosing on your site or service methods by which individuals can contact your business with COPPA information – such as: 1) contact information for designated individuals, 2) a specific phone number, and/or 3) an online form or email address – will reduce the likelihood that you would be deemed to have gained actual knowledge through other employees. (See also FAQ D.12 below).

D.11. I operate an ad network. I receive a list of Web sites from a parents’ organization, advocacy group or someone else, which says that the Web sites are child-directed. Does this give me actual knowledge of the child-directed nature of these sites?

It’s unlikely the receipt of a list of purportedly child-directed Web sites alone would constitute actual knowledge. You would have no duty to investigate. It’s possible, however, that you will receive screenshots or other forms of concrete information that do give you actual knowledge that the Web site is directed at children. If you receive information and are uncertain whether the site is child-directed, you may ordinarily rely on a specific affirmative representation from the Web site operator that its content is not child-directed. For this purpose, a Web site operator would not be deemed to have provided a specific affirmative representation if it merely accepts a standard provision in your Terms of Service stating that, by incorporating your code, the first party agrees that it is not child directed.

D.12. I operate an ad network and am considering participating in a system in which first-party sites could signal their child-directed status to me, such as by explicit signaling from the embedding webpage to ad networks. I understand that I would have “actual knowledge” if I collect information from users on a first-party site that has signaled its child-directed status. Are there any benefits to me if I participate in such a system?

Such a system could provide more certainty for you. If the system requires the first-party site to affirmatively certify whether it is “child-directed” or “not child-directed,” and the site signals that it is “not child-directed,” you may ordinarily rely on such a representation. Such reliance is advisable, however, only if first parties affirmatively signal that their sites or services are “not child-directed.” You could not set that option for them as the default.

Remember, though, that you may still be faced with screenshots or other concrete information that gives you actual knowledge of the child-directed nature of the Web site despite a contradictory representation by the site. If, however, such information is inconclusive, you may ordinarily continue to rely on a specific affirmative representation made through a system that meets the criteria above.

K.2. I operate an ad network. I discover three months after the effective date of the Rule that I have been collecting personal information via a child-directed website. What are my obligations regarding personal information I collected after the Rule’s effective date, but before I discovered that the information was collected via a child-directed site?

Unless an exception applies, you must provide notice and obtain verifiable parental consent if you: (1) continue to collect new personal information via the website, (2) re-collect personal information you collected before, or (3) use or disclose personal information you know to have come from the child-directed site. With respect to (3), you have to obtain verifiable parental consent before using or disclosing previously-collected data only if you have actual knowledge that you collected it from a child-directed site. In contrast, if, for example, you had converted the data about websites visited into interest categories (e.g., sports enthusiast) and no longer have any indication about where the data originally came from, you can continue to use those interest categories without providing notice or obtaining verifiable parental consent. In addition, if you had collected a persistent identifier from a user on the child-directed website, but have not associated that identifier with the website, you can continue to use the identifier without providing notice or obtaining verifiable parental consent.

With respect to the previously-collected personal information you know came from users of a child-directed site, you must comply with parents’ requests under 16 C.F.R. § 312.6, including requests to delete any personal information collected from the child, even if you will not be using or disclosing it. Furthermore, as a best practice you should delete personal information you know to have come from the child-directed site.

]]>https://www.adlawbyrequest.com/2013/07/articles/childrens-advertising/ftc-issues-new-coppa-guidance-focusing-on-ad-networks/feed/0jfeldman@reedsmith.com, flah@reedsmith.comOFT Investigates So-Called “Free” Web- And App-Based Children’s Gameshttps://www.adlawbyrequest.com/2013/05/articles/childrens-advertising/oft-investigates-so-called-free-web-and-app-based-childrens-games
https://www.adlawbyrequest.com/2013/05/articles/childrens-advertising/oft-investigates-so-called-free-web-and-app-based-childrens-games#respondFri, 10 May 2013 16:48:53 +0000http://adlawbyrequest.wp.lexblogs.com/2013/05/oft-investigates-so-called-free-web-and-app-based-childrens-games/Continue Reading]]>Over the last year, a number of cases have been reported where children have unwittingly racked up huge bills while playing web and app-based games that are free to download. The bills came from expensive “in-app purchases” of content such as upgraded membership and virtual currency, which is how many of the top-selling apps make money. In a recent example, a 13-year old boy from Somerset spent £3,700 on chests of virtual gold coins and other game-enhancing content.

Last month, the Office of Fair Trading (OFT) launched an investigation into the way web- and app-based games manufacturers market their products to children. The investigation will discuss whether such games may be in breach of The Consumer Protection from Unfair Trading Regulations 2008, which prohibit “including in an advertisement a direct exhortation to children to buy advertised products or persuade their parents or other adults to buy advertised products for them”. The latter practice is more commonly known as “pester power”. The OFT is also considering whether the full cost of these games is made clear at the outset. As part of the investigation, the regulator has written to games developers and hosting services, and has asked consumers to contact it with information about potentially misleading, commercially aggressive or otherwise unfair marketing. Cavendish Elithorn, the OFT senior director for goods and consumer, said: “We are concerned that children and their parents could be subject to unfair pressure to purchase when they are playing games they thought were free, but which could actually run up substantial costs”.